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Huawei: When reality hits home and Trump is America CEO.

proIsrael-nonIsraeli

Legendary Member
"Underestimating your adversary"

Why would you think that such obvious move would be underestimated - do not rush things, give it few days and everything will bounce back.
Underestimating your adversary...

Dow tumbles over 800 points as U.S.-China trade fight intensifies

And as if on cue from yours truly: "The Dow Is Bouncing Back From the Brink Because China Isn’t Letting Its Currency Crumble"

FYI - Dirty little secret, China cannot afford to make its currency too cheap, she will stop earning from exports.
 

HannaTheCrusader

Legendary Member
Orange Room Supporter
what i have always spoke of
surely but steadily
usa companies are reducing their manufacturing base in china
and hence,once a job is lost, its gone forever
china has made the stupid mistake by blackmailing its main customer and they will pay dearly for it
what ever hardships and rising prices the us customers has to put up with, will be mitigated down the road and in the long term
china is about to learn the word CAPITALISM and what it really means
already chinese firms are ordering less from japan and south korea, due to slowing down of sales .true japan and sk will be affected in the short tie
but they can alyas get new clients in vietnam, cambodian etc



U.S. companies had already started taking steps to diversify production amid flaring tensions over the past year, but this latest command forces a myriad of industries to grapple with escalating trade uncertainty.

President Trump said last week he would raise existing duties on $250 billion in Chinese products from 25% to 30% on Oct. 1. Additionally, tariffs on another $112 billion of Chinese goods, which took effect on Sunday, are now 15% instead of 10%. Weighed down by a protracted trade dispute over the past year, China has relinquished its top spot as America’s largest trading partner and now sits in third place.
Few companies are planning to move completely out of China. Doing so would prove particularly disruptive for America’s industrial and technology heavyweights that rely on the Chinese manufacturing base as a critical part of their supply chain. China still makes roughly 25% of all manufactured goods around the world — in part because of the difficulty in finding a sufficient workforce on other countries’ factory floors.
Given the proximity to China, Southeast Asian countries including Vietnam, Indonesia and Malaysia have attracted attention in recent months as potential alternative sourcing destinations. A handful of firms have successfully shifted some of their production to these places, but many have been stifled by a dearth of specialized supply chains and labor shortages (in Cambodia, over 40% of all goods inspected last quarter did not meet inspection standards).
Take Boeing for instance — the Seattle-based aircraft maker doesn’t look poised to abandon the Chinese market any time soon after opening a plant for 737 Max jets late last year. Moving production could also put Boeing at risk of ceding ground to rival Airbus, which competing heavily in the Chinese market. Boeing’s business is estimated to add more than $1 billion to China’s economic each year. The company delivered 200 new 737 Max planes to Chinese airline Xiamen last fall.
Apple is another prime example. Most of the technology giant’s products are built in China, and its largest supplier Foxconn produces the lion’s share of the company’s iPhones in 29 factories in the central province of Zhengzhou. Taken in total, roughly 50% of Apple’s supplier locations are based in China, up 5% just in the past four years. It would take years for Apple to leave China altogether and could clear the way for competitors like Samsung to eat into its market share. Apple also notoriously failed to build high-end computers stateside — stymied by a lack of suppliers that could make the right screw.
Still, Apple has reportedly asked its major suppliers to assess the cost implications of moving between 15% and 30% of their production capacity from China to countries in Southeast Asia. That’s in part because its smartwatches and AirPod wireless headphones now face a 15% tariff, while a tax on the iPhone could take effect on Dec. 15.
America’s other largest technology firms are following Apple’s lead. Computer makers HP Inc. and Dell Technologies are reportedly contemplating moving up to 30% of their notebook production out of China. Antonio Neri, CEO of Hewlett Packard Enterprise, told CNBC this week that the company managed to mitigate the tariff impacts this past quarter in large part due to a diversified supply chain. And, just yesterday, multiple outlets reported that Alphabet-owned Google is moving production of its Pixel smartphone, the fifth biggest smartphone brand in the U.S., to Vietnam, starting as early as this fall. Google also plans to eventually move production of most of its hardware that is bound for the U.S. to Vietnam.

“On the margin, I’m not aware of a single supplier who is not moving some form of manufacturing outside of China.”
Ted Decker
 

HannaTheCrusader

Legendary Member
Orange Room Supporter
For hundreds of American companies, notably retail names such as Starbucks, up and leaving China isn’t something they can afford to do. O’Reilly Automotive CEO Gregory Johnson, for example, said that, while the car parts supplier is exploring alternate sourcing locations, it wouldn’t be a short-term change because of the lack of capacity elsewhere.
But the trade war, heightened by Trump’s latest rhetoric, is convincing a growing number of U.S. multinationals — beyond big tech firms — to shift production to countries less likely to be hit with tariffs.
“On the margin, I’m not aware of a single supplier who is not moving some form of manufacturing outside of China,” Home Depot Executive Vice President Ted Decker told investors on Aug. 20. “So, we have suppliers moving production to Taiwan, to Vietnam, to Thailand, Indonesia, and even back into the United States.”
‘Made in China’ loses its luster
To be sure, even before the trade war started last year, factory production had begun to leave China, stung by the country’s slowing economy, rising labor costs, and tighter environmental regulations.
But, over the past month, the pressure has intensified. As President Trump ratchets up his rhetoric, many American business leaders have taken to earnings conference calls to describe what they see as exigent circumstances. To adapt to an increasingly volatile playing field, executives are being pushed to rethink their supply chains.
And, in an annual survey conducted in June by the U.S.-China Business Council, nearly 30% of the 220 respondents said they have already delayed or cancelled investments in China or the U.S. due to mounting trade uncertainty. Though just 13% said they had plans to specifically move operations out of China, that’s steadily increased from 10% in 2018 and 8% in 2017. The shift could be even more pronounced now as the survey was conducted at a time when officials in Beijing and Washington were restarting trade talks.
“While China continues to be a priority market for most of the companies surveyed, market optimism is moderating,” the survey noted. Of those companies that decided to reduce new investments, 60% cited increased costs or uncertainties from U.S.-China trade relations.
 

HannaTheCrusader

Legendary Member
Orange Room Supporter
Retail, industrial firms in the crosshairs
Different sectors face distinct challenges and varying scales of uncertainty.
Toymakers, shoe manufacturers, and apparel producers are building off of a decades-long shift out of China. These companies have been hit by a confluence of factors, most notably an eight-fold rise in average blue-collar wages since 2004. The average hourly manufacturing compensation in China sits at $4.12, according to Barclays research, versus, for instance, $1.59 in India.
“Today, many retailers find themselves under the strain of rising sourcing cost resulting from their over-reliance on China and other higher-cost sourcing markets,” The Children’s Place CEO Jane Elfers said on a call with investors on Aug. 21.
Some analyst see toymaker Hasbro, which has been shifting its business out of China since 2012, as a vanguard for the broader retail industry.
“We’re seeing great opportunities in Vietnam, India and other territories like Mexico, ” Hasbro CEO Brian Goldner told CNBC this past week. “We’re doing even more in the U.S. We brought Play-Doh back to the U.S. last year, ”
He added that two-third of the global business comes out of China but that’s down substantially from nearly 90% in 2012.
“We’re seeing an opportunity that will lead us, by the end of 2020, to be at about 50% or under for the U.S. market coming out of China,” Goldner said. “We believe by 2023, we should be under a third.”
On Hasbro’s earnings call last month, Goldner underscored the company’s increased spending to expand its production footprint globally, specifically in India and Vietnam.
 

HannaTheCrusader

Legendary Member
Orange Room Supporter
Huawei sales and marketing managers are internally charting a drop in volumes of anywhere between 40 million to 60 million smartphones this year, the people said. That’s a big chunk of an international business that in 2018 accounted for almost half of the 206 million phones it moved. The unusually wide range underscores the uncertainty gripping Huawei, a Chinese national champion that Washington accuses of aiding Beijing in espionage -- something the company has repeatedly denied.



On Monday, billionaire Huawei founder Ren Zhengfei confirmed the company had endured about a 40% drop in smartphone shipments abroad, which a company spokesman said referred to a fall over the past month. Ren expects Washington’s sanctions to curtail its overall revenue by about $30 billion over the coming two years, wiping out the networking giant’s growth. Ren was surprised at the extent to which Washington attacked his corporation, but Huawei will maintain its research budget while refraining from layoffs or major asset sales, he added.
 

HannaTheCrusader

Legendary Member
Orange Room Supporter
He is probably referring to China exempting Tesla a week ago, from 10% purchase tax...


NOPE


China grants tariff exemptions to 16 types of US goods ahead of trade war talks
  • Waiver will take effect next week and remain in place for one year, Customs Tariff Commission says
  • Latest round of negotiations set to take place in Washington next month
  • China is expected to agree to buy more American
    agricultural products
    , a source familiar with the situation said.

china has to make a deal
or pay the price
more and more us companies are relocating out of china, at least half their manufacturing base

this is bad news for the long term
 

Abou Sandal

Legendary Member
Orange Room Supporter
NOPE


China grants tariff exemptions to 16 types of US goods ahead of trade war talks
  • Waiver will take effect next week and remain in place for one year, Customs Tariff Commission says
  • Latest round of negotiations set to take place in Washington next month
  • China is expected to agree to buy more American
    agricultural products
    , a source familiar with the situation said.

china has to make a deal
or pay the price
more and more us companies are relocating out of china, at least half their manufacturing base

this is bad news for the long term

Everyone has to make a deal, as with no deal it won't be good to anyone, and not only US and China, but other countries too. Globalization is too stretched to the point where all are in the same boat.

As for those exemptions, China is showing good faith in negotiations, although not giving anything more than what the other side had, before that trade war thingy. Now for internal consumption, Trump wants to brag about it as if he achieved anything, fine. Let's see now if he is capable of showing the Chinese good faith from his side and in return.

I think he will jump on it.
 

HannaTheCrusader

Legendary Member
Orange Room Supporter
Everyone has to make a deal, as with no deal it won't be good to anyone, and not only US and China, but other countries too. Globalization is too stretched to the point where all are in the same boat.

As for those exemptions, China is showing good faith in negotiations, although not giving anything more than what the other side had, before that trade war thingy. Now for internal consumption, Trump wants to brag about it as if he achieved anything, fine. Let's see now if he is capable of showing the Chinese good faith from his side and in return.

I think he will jump on it.


great thats what is required
for all to make a deal

thats what trump has been saying since he was running for president

its juts
china
europe
mexico

were used to the old way of deals ( deals that favors them )

so today, they are realizing that they need to make new and better deals for everyone

i hope its so and this will be a win win for all

رويترز: مبيعات السيارات الصينية تنخفض 6.9% في آب للشهر الرابع عشر
 

HannaTheCrusader

Legendary Member
Orange Room Supporter
Trump is making china kneel and they will capitulate at the end
as i predicted


china can ill afford to alienate its most singular customer

make trump happy china or else suffer

the diff with usa and china, is the usa is based on free enterprise and not dependent on state funding etc

 
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